Building Houses Won’t Solve Brazil’s Shortage. Country Needs to End Real Estate Speculation

Occupied INSS abandoned building in RioThe issue of quality housing has come to the fore, as properties are expropriated to make room for mobility works, and an increasing number of empty buildings are occupied in the great urban centers. The street protests staged in 2013 helped promote the debate on the matter, which is now addressed by presidential candidates as part of their electoral campaigns. 

Whoever is elected as Brazil’s next head of state will face a shortage of 5 million homes, according to the Ministry of Cities. Building new houses, however, is not enough to tackle this deficiency, experts on city planning have said. Rather, the country’s next president will have to face the challenge posed by property speculation.

In the view of Guilherme Boulous, from the national coordination of the Homeless Workers’ Movement (MTST), the housing situation in the country deteriorates just as rents are seen to rise.

He believes that the construction of houses by the government at the current pace is not sufficient to cover all the families in need of a new home, and does very little to drive rents down.

“It’s a barrel of gunpowder that was bound to explode one day,” he said. “Over the last five years, the rise in property prices exceeded 130% in the city of São Paulo and 200% in Rio de Janeiro.”

He notes that this surge is not regulated by the market, and adds that there is no social assistance for those who have to pay the rent to keep living under a roof.

According to data from the Brazilian Institute of Geography and Statistics (IBGE), the number of vacant properties in the country reaches 6.1 million. MTST argues for a countrywide policy that would see these properties expropriated and renovated, affording people a place to live, rather than just contributing to price hikes.

The movement has further proposed a law limiting rent rises. “Families are no longer able to pay the rent has become a burden”, Boulous remarked.

Professor Paula Santoro, from the School of Architecture and Urban Planning (FAU) of the University of São Paulo, adds that current housing policies, which prioritize the construction of houses for low-income families and a higher ceiling on mortgages for the middle class, are based on market rules, and only benefit those profiting from high property prices.

With more credit available, the market tends to increase the prices. And as the families from the lower classes are unable to afford the mortgage, the houses built for them end up being sold to those who earn a higher income.

“If the federal government’s policy were one of affordable housing, and if there were joint efforts from both state and federal governments, there would be funds to implement these affordable rents” she said.

In this case, the professor explains, there would be no need for mortgages, as the government would offer families low-rent homes.

“So if the government charges low-income families 400 reais (US$ 176), the market, which rents out a similar home today for 800 reais (US$ 353), would have to lower its prices.”

Affordable housing policies are set forth in the Statute of the Cities, the law that lays down the rules for urban planning, established by the Constitution, and could benefit families financially challenged by unemployment, health conditions, etc, and also help the homeless, Paula Santoro adds.

Another mechanism defined by the Statute – and mentioned by the experts – is the allocation of housing units in the new residential buildings to low-income families, regardless of the neighborhood in which these buildings are located.

This system has already been adopted in large cities across the world, like London and Brussels, where setting aside a certain number of apartments for this purpose is mandatory in every building.

According to Professor Orlando dos Santos Jr., from the Federal University of Rio de Janeiro, this measure is an attempt to fight the apartheid among the districts and encourage the diversification of cities by taking the poor away from neighborhoods with precarious infrastructure.

Today, he notes, “the greater access to income allows families to purchase consumer goods such as refrigerators, computers and cars, but that doesn’t mean they have access to […] mobility, sanitation, and housing.”

To foster the development of the country, he says, it is necessary to consider how cities are organized. “One cannot reduce the housing issue to a matter of numbers. There’s no escape from combating the property market,” he argues.

Joint efforts from the government and organizations from society can also help ensure the right to housing, according to the National Movement for the Fight for Housing (MNLM).

In Rio de Janeiro, the residents of a building called Occupation Manuel Congo, where nearly 50 families reside, will refurbish it with funding from the government’s My House My Life initiative.

Located in the downtown area, the building was vacant and was expropriated in order to receive the new residents, who are responsible to pay its maintenance costs.

“We’ve set up a fund to which everybody contributes, and at the end of the month we pay the bills,” MNLP Coordinator and resident Elisete Napoleão explained.

ABr

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